Performance Management Systems Of Muslim Commercial Banks Commerce Essay

It is one to the fact that organizations with excellence in performance can survive only in the highly competitive global market conditions. An exceptional system can be managed by a highly motivated Human Tool with the talk about of artwork equipment. A motivational drive is enough to drive and encourage the employees to do miracles for the organization. Without energetic role of HR of the organization, it is impossible to compete in today's fast changing business world. So, human learning resource only create the difference when properly trained, developed suitably encouraged through intrinsic and extrinsic compensation rewards system.

This study will be produced from performance management system with particular reference to applicability of the system to Pakistan banking industry. Main thing is the fact that it targets activities of PMS like manpower planning, rewards & compensations, training & development, job planning. PMS is the powerful system which helps in moving the organizational aims down the hierarchy and further helps in its planning monitoring and evaluating its performance.

The first proposition behind doing the research study of the Performance Management Systems (PMS) of the home bank industry is the significance of the Human Resource component of a business. Every organization has some aims to accomplish and in order to accomplish these aims company must obtain and utilize various resources in such way that they can add towards these goals or aims. As resources are both human and non individuals such as physical, and these are incredibly limited as well but individual source is main advantage of any organization and must give special attention by firm to be able to get desired results.

The second proposition is designed for human resource motivational force required to perform the given tasks and also to confidently add towards achievements of organizational goals. For the achievements of goals there should be internal and exterior changes on surroundings. External surroundings includes social, politics, economical and ethnical changes, while interior environment includes existing framework, technology, needs and prospects of its people and changing of the labour force.

Scope of Study:

The range of the research is to review the planning, monitoring and analysis of the performance management in international organizations and then to compare these methods with the PMS being currently found in the Pakistani local banking industry. For this purpose one of the leading local banking institutions that is privatized in the past 15 years which is MCB.

The reason for the performance management system at MCB is to provide a formal assessment programme to judge work performance and promote communication and conversation of job performances of the employees. The intention of these discussions is to examine current job performance and responsibilities, arranged goals and discuss future opportunities with reference to previous performance at the bank.

To measure work performance.

To motivate and assist employees in increasing their performance and achieving their personal or the professional profession goals.

To identify employees with high prospect of advancement.

To provide objective information for making decisions on salary raises, promotions, extra and transfers.

To identify employees training and developmental needs.

To give a path for job planning for every single individual.

Research aims:

The objectives of the conducting research on PMS of MCB are salient and appended below

· To study the prevailing PMS of the Muslim Commercial Lender in Pakistan.

· To gauge the work performance of employees and also to identify their developmental and training needs for achieving organizational goals.

· To find the talents and weaknesses of both the suggested system and the main one being applied in local environment.

· In light of the results of the comparative examination, further suggest advancements in the proposed platform.

Research Questions:

· What and how Muslim commercial loan provider(MCB) is using PMS in order to achieve its goals?

· How MCB must do planning, monitoring and evaluation of performance management by following a PMS of leading Organizations?


· Who should be involved in the performance management activities and what should be assessed?

· What benchmarks should be utilized or set, and exactly how?

· How is quality improvement efforts carried out and how is improvement reported for use in decision making?


History and foundations of performance management:

A strategy which web links to every steps of the business occur the framework of its real human resource plans, style and communication systems. It really is up to the framework of a business and may differ from other company. Taylor's pioneering Time and Motion studies has followed root base of PMS in the first 20th century. Like a diverse and formal management technique found in the analysis of work performance, PMS really dates from the time of the Second World Conflict - only 60 years back.

Since the first 1990s Chartered Institute of Workers and Development (CIPD) have followed the development of performance management from a intensely bureaucratised procedure focused on objective-setting or merit score to a more wide-reaching and inclusive process combined with other related routines such as expertise management, job management, and development. If we see in the history, in later 1990s and early on twenty first century closely featured done employees and performance has done. It was discovered along with training and work design as a key factor in performance.

CIPD has pointed out lack understanding performance managements through its link to development, pay & most recently talent management to its place as a tool for line professionals to immediate skill and effort. CIPD also unconcealed the components of PMS and revealed the number of elements how do work together to build the PMS which was more appropriate to them.

What is Performance?

"You can't assess or control the performance If you cannot establish" Armstrong and Baron (2002). There are different views on what performance is. It can be regarded as simply the record of final results achieved.

Brumbrach (1988) has given most complete meaning of performance i. e.

"Performance means both behaviours and results. Behaviours result from the performer and transform performance from abstraction to action. Not only the implements for results, behaviours are also effects in their own right - the product of mental and hard physical work applied to tasks and can be judged apart from results".

Bernadin, Kane, Ross, Spina and Johnson (1995) claim that

"As performance provides the strongest linkage to the strategic goals of the organization, customer satisfaction and economic contributions it ought to be defined as outcomes of work ".

What is Performance Management?

Performance management is an activity for ensuring employees are concentrating their work attempts in ways that donate to achieving the business's mission. It includes three parts: (a) establishing values and opportunities for staff performance, (b) retaining a talk between supervisor and staff to keep performance on track, and (c) measuring genuine performance comparative to performance expectations.

What is Performance Management System?

An effective performance management system includes

1. An activity for communicating staff performance expectations, executing annual performance appraisals and maintaining on-going performance talk.

2. An activity for addressing worker performance that falls below anticipations.

3. A practise for stimulating and facilitating worker development.

4. It is an exercise for taking care of performance and administering the machine; and

5. A way for resolving performance pay disputes.

6. An activity of doing strategic and financial planning and deliver key functions by b allocating good resources.

7. To achieve cost effective check financial performance and responsibility.

Purpose of Performance Management System:

Performance Management System (PMS) is an extremely valuable approach in the hands of the Human Resource section, which can help to drive performance. It can play an important role in cascading the organizational goals down the hierarchy, if dealt with correctly this tool can give desire multiple results directing the business on the path of success. additionally, it may help in obtaining competitive advantages when corporation has clear commercial strategies.

The main reason for the Performance Management System is to ensure that;

1. The work performed by employees achieves the goals of the organization.

2. All employees of the organization have a understanding of the quality and level of work expected from them.

3. All employees obtain current information about how exactly effectively they are really performing in accordance with expectations.

4. Based on employee performance Honors and salary increases are distributed consequently.

5. For worker development opportunities are discovered; and

6. Dealt with the worker performance that does not meet goals.

Performance Measure Requirements:

Every firm has its criteria to measure the staff performance through job evaluation and design. To evaluate performance management systems, there are three main solution criteria they are; proper congruence, validity and stability, which are talked about below

1. Strategic Congruence.

Strategic congruence is the amount to that your performance management provokes job performance that is congruent with the organization's strategy, goals, and culture. PMS of customer support Company should examine how well its employees are serving the company's customers looked after requires the necessity for PMS to provide instruction so that employees can provide excellence performance to the organization's success. So, this involves the system to be flexible enough to adapt to changes in the company's strategic good posture.

2. Validity.

The degree to which the PMS assesses all the relevant and only the relevant aspects of performance is named Validity (categorised as content validity). For the valid performance solution, it should not be contaminated or deficient - meaning only those areas should be evaluated that are only concerned with the employee's job. A Contaminated measure methods to evaluate irrelevant aspects of performance or aspects that are not related to job. A performance system should search for irrelevant aspects to minimize contamination. A Lacking measure means which does not evaluate all aspects of performance.

3. Reliability.

Reliability means steadiness and uniformity of the performance measure. "Interrater stability" means the uniformity and stability among the individuals who evaluate the employee's performance. If two individuals supply the same assessments of a person's job performance then performance solution will have Interrater reliability. Another type of reliability strategy is the "test-retest reliability" that identifies the reliability over time. A strategy that results in considerably various scores depending upon enough time, of which the measures are taken, lacks test-retest consistency.

As Performance indicators are measured at different levels. It is important that professionals and personnel should clear about the links between various different levels. Shape 1 shows the links between different kinds of performance options, and the levels of which they can be used.

Figure 1 :The hierarchy of performance management

Figure 2: The plan-do-review-revise circuit of performance management

The performance management circuit occurs over different timescales at a number of levels. On annual or three yearly cycles' major proper reviews and revision you can do, although the circuit of review and revision may occur every month or one fourth at a far more precise level. While at the level of staff support and guidance, managers may establish tasks, watch performance and present helpful reviews from daily.


Research Idea and Solutions:

A research school of thought is a opinion about the way in which data in terms of a phenomenon

Should be accumulated, analysed and used. The term epistemology means what is known to be true as, against doxology which means what is thought to be true encompasses the various philosophies of research methodology. The purpose of knowledge, then, is the procedure of transforming things assumed into things known: doxa to episteme.

Two major research philosophies have been recognized in the European tradition of knowledge, namely positivist which means sometimes called medical and interpretivist which means also known as antipositivist (Galliers, 1991).

In my research I'll use Interpretivists philosophy because only through the subjective interpretation of and Intervention the truth is can that certainty be fully recognized. The study of phenomena in their natural environment is key to the interpretivist school of thought, alongside the acknowledgement that experts cannot avoid impacting those phenomena they study. They confess that there may be many interpretations of fact, but maintain that these interpretations are in themselves an integral part of the scientific knowledge they can be pursuing. Interpretivism has a tradition that is believe it or not glorious than that of positivism, nor is it shorter.

My over-riding concern is that the research I undertake should be both highly relevant to my research question and targets. Overall I assume that an interpretivist philosophy is required for this purpose, i. e. the understanding of how both Finance institutions (MCB & ABL) choose and adapt to the utilization of Performance Management Systems. This research requires an factor of PMS insofar as it was not previously accompanied by the organizations. This thus requires important part in the execution process. Furthermore, to be able to assess how organisations can improve their performance with the support of PMS, I make recommendations for use of the International PMS after analysing existing PMS. To accomplish each one of these things without having to be involved would be impossible. However, recognising the lack of objectivity sometimes associated with interpretivist research methods, I choose a positivist, quantitative approach to the introduction of my key research device.

Husserl (1946) stated that the phenomenological paradigm argues that the world and the reality aren't objective and exterior, however they are socially built and given meaning by people (Burrel and Morgan, 1979:240-255).

The research issue, analysis of the impact of PMS, could be tackled with a positivist or phenomenological paradigm. The natural problem to this approach is the fact results provide very little insight to manager and professionals, i. e. to help them identify and understand the impact of PMS and positive factors to boost business performance. In understanding and analyzing the impact of PMS, it's important to visit the fundamental point 'phenomenon's root' where impact is established and know how it is created. Which means that it is important to comprehend its context (internal and exterior factors). Therefore, this research calls for level of sensitivity and in-depth understanding from different domains around business, strategy, functions and much more from customers.

3. 2 Research Strategy:

PMS is having great effect of the performance of the business and really helps to improve it as well. It really is a continuous, strategic and integrative methodology that has many steps; each step is important and adds value to the complete PMS. All the big organizations are benefitting from PMS because each and every step is interlinked with one another in the constant process.

This research involves an effort to describe relationship of PMS which exist the truth is, in the lender and with the examination of different factors observer-researcher can get more detail the truth is than is normally possible in experimental and survey research. As researcher is observer so, I will use more descriptive and explanatory strategy to do more concentrate on "How?" and "why?" MCB Bank is which consists of PMS. And also by doing;

The Research will rely on theoretical record research, planning and execution of loan provider observations in Pakistan including interviews and dialogue with relevant people (top level- lower part level management) for attaining first-hand knowledge about the PMS implementation. by doing immediate and indirect observation of activities and phenomena and their environment.

The information and data will be analysed, compared with international experience and presented by means of a study dissertation highlighting some issues involved with PMS of MCB Pakistan and suggest, where required, recommendations and suggestions.


Assistance because of this research will be studied by using both quantitative and qualitative techniques. Secondary data collection strategy includes use of different textbooks, journals, circumstance studies, research publications and Internet. While my main target would be on qualitative data collection such as by executing interviews and conversations with concerned officials of the lenders during visits to MCB in Pakistan is Principal Data Collection technique and these both techniques targeted at extracting all possible information about the PMS being executed in MCB. And interviews from professionals and employees will help in observing actual behavior of these towards their goals and targets of organization. Establish rapport with respondent and good understanding of respondent's view. With this I'm also able to have close observation and involvement of personnel. By conducting organized and unstructured interviews from the personnel of the bank.

Documentation, such as written, imprinted or electric information about the

Company and its operations; also magazine cuttings;

Records and graphs about past use of PMS relevant to the research.

Of these, the second, i. e. review of participant attitudes through a

Questionnaire is the technique that has required most developmental work.

Ethical issues

Many different universities, professional associations and government agencies have used specific codes, guidelines, and policies associated with research ethics. East Carolina University or college (ECU) has a variety of policies associated with research.

It is very essential to have ethical guidelines in research since it advertised the aims of research. It also provides prices that are essential to collaborative work like trust, responsibility, shared respect and equality. The research can be accountable to the general public and it also really helps to build public support for the study. These ethics also promote a variety of other important moral and sociable values which include animal welfare, cultural responsibility, human privileges, health and basic safety and conformity with the law.


In my research I will follow all the moral rules in order to provide honest, fact, knowledge, results, methods, strategies to avoid occurrence of mistakes in my research and will not make falsify, or misrepresent data and will not deceive co-workers, granting organizations, or the general public.


In order to check out the ethical codes I'll protect trustworthy communications, such as papers or grants published for reserve or journals, personnel data, business work or secrets, and any documents of Bank or investment company (MCB).

Respect for Intellectual Property

By executing research I am going to not honour copyrights, charters, patents and other types of intellectual and educated property. I'll not misuse printed data, methods, or results without agreement. And I will follow ethical rules and will give proper acknowledgement for everyone assistances to analyze and will never copy and imitate.

Data Gain access to:

I will gain access to data by pursuing different types of resources. My main emphasis would be on my research objectives, questions and research design process. I am going to stop by at Pakistan so you can get primary data collection and can also arrange sessions and meetings with managers and employees of the both lenders in Pakistan regarding my research. I'll also use supplementary data from journals, books, by visiting both lenders and their public websites, also by surfing school website Athens, and different articles. Beside this, for collecting secondary data I am going to read International specifications for PMS, So that I can compare people that have my research easily.

Resource Implications:

This research consists of both key and extra information. I am going to pursue the Content Analysis technique that is usually know as past literature review which has been follow in the analysis of the research topic. Apart from this, cost factor may also be major concern because my dissertation research will require making an individual stop by at Pakistan.

Gantt Chart

Timetable of the main element activities



















Follow up meetings &

obtaining information

Obtaining Historical




Deriving a


Developing the


Editing & Preparing

Final Draft

Final Report


Regular connection with the supervisor would be managed in order to receive feedback and continue the activities in the right way throughout the time of the action applied for research project.


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